Crisis in Venezuela: What’s Really Going On?

Perhaps not dominating, but infiltrating headline news for over a year now, is the political turmoil in Venezuela. The somewhat secondary reporting style regarding this crisis could perhaps be assigned to the fact that more ‘pressing’ matters concern the west at the moment; but you only need to obtain a few of the facts regarding life on Venezuelan streets in order to truly understand the sheer catastrophic consequences that political corruption has had on Venezuelan society.

As the 10th most corrupt country in the world, the causes and effects of this corruption are of significant, relevant interest in the realm of international news.

Why Venezuela?

In order to fully comprehend the scale of the corruption in Venezuela, we first need to answer; what made Venezuela a prime target for such corruption? We can start here with the basic assumption that wherever corruption arises there is some claim in said area for power, wealth or some other desirable commodity – often at the expense of the preference of the electorate. Venezuela’s history of dictatorships disguised under democratic rule does not do much to dispel this idea, but this along with a history of civil wars at the same time does nothing to differentiate it from other states of similar historical calibre. So what is it that makes Venezuelan corruption in particular so deadly? Answered simply: resources. With oil revenues accounting for about 95 per cent of export earnings, Venezuela is naturally rich, and its history is saturated with an accumulation of wealth from oil. The country’s reliance on oil as its primary source of external income has left it vulnerable to any international market fluctuations and as a result, the entire country feels the exaggerated effects of corruption in the oil trade. This, teamed with the extreme socialist aspirations of the previous government, has led to a country fraught with instability.

What is life like in Venezuela at the moment as a result of this corruption?

Currently, the quality of life in Venezuela is at an appalling level, with the manner in which people are having to go about their daily lives almost incomprehensible. The country has run out of medicine, and hyper-inflation means that simply over night the price of a loaf of bread could become equivalent to a week’s wages. The exchange rate compared with US dollars is so abysmal it is barely worth the exchange; dollars can only be bought on the black market and a plane ticket out of the country is almost the majority of someone’s livelihood. Recently determined as the most miserable country in the world, Venezuelans are unhappy and unsafe.

State run media makes it very difficult for people to exercise any amount of free speech in the country, as any outspoken opposition to the government runs the risk of being declared an incitement of violence – a punishable offence. It is this which is partially responsible for the meltdown in social organisation as the media restriction results in a warped view on society and as a result creates panic amongst those who are confused by conflicting stories. With the leader of the opposing party having been imprisoned, at the moment it seems out of the question that the current party are acting in the interests of democracy, further highlighting the levels of the political corruption in the state. This socialist regime is supposedly in support of an egalitarian society, but has yet to show any characteristic other than a) party self-interest and b) outdated political aspirations.

But what is the impact on the rest of the world?

Here we can examine the effects of Venezuelan corruption in two different ways: social, and economic. At a social level the political turmoil makes for increased migration from Venezuela, discontent amongst its varying partner nations and calls from countries globally for aid increase and political intervention. Human rights associations have taken it upon themselves to attempt to quell some of the suffering in the country, but it is not a safe place to venture with crime rates amongst the highest in the world: it has the second highest murder rate accounting for up to 90 deaths in every 100,000.

Economically speaking, the oil trade from Venezuela has long since been in large decline as a result of a major decrease in productive capacity, despite having the largest proven reserves in the world. Consequently, the country has sunk to 132 out of 140 economies in the global competitiveness report. It is therefore more likely that any international economic impacts will stem from the hyper-inflation from within the country which has the potential to reflect in the international system. Due to the poor exchange rate however, it is unlikely that any national shocks will majorly affect international markets – more likely is that minor global shocks will have an exaggerated impact on Venezuela’s own economy.

It is no longer enough to report the crisis in Venezuela and assume that the inflation will decrease, the political system will gradually sort itself out and the people will settle. The past few years have shown that left to its own devices, the presidential system in this country will live beyond its means and exploit the masses. The people are uneducated and the media restriction in itself is enough to send the population into a downward social spiral of confusion. Global education regarding this crisis is a crucial step in determining the appropriate solution to the crisis in Venezuela.